Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/250304 
Authors: 
Year of Publication: 
2021
Series/Report no.: 
Memorandum No. 02/2021
Publisher: 
University of Oslo, Department of Economics, Oslo
Abstract: 
I demonstrate a straightforward but apparently widely unrecognized implication of the standard requirements for perfect competition: an economy in which consumers can choose to learn is generally not perfectly competitive. In particular, if endogenous welfare relevant learning is feasible, the economy cannot be perfectly competitive unless identical learning choices by all consumers are guaranteed. If the new information is not shared with everyone, asymmetric information arise; if information is shared, externalities arise. The standard conditions for the two fundamental welfare theorems, thus, implicitly preclude heterogeneous welfare relevant learning decisions.
Subjects: 
Perfect competition
fundamental welfare theorems
learning
symmetric information
externalities
JEL: 
D41
D50
D60
D61
D62
D82
Document Type: 
Working Paper

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